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Do you really want to grow?

What happens when you grow? There's an assumption that every business wants to grow because growth means making more money. Bigger companies make more money, that's what we all think, right? But it's not always true. In fact, sometimes, the people who are really pocketing the most money at the end of the year are the people who don't have the biggest businesses.

What really matters is how much profit you get to keep

Isn't it how much money that goes into your pocket that really matters? Who cares how many employees you have or how big and fancy your office is? What really matters is how much profit you, the business owner, get to keep. All of those other things are what we call “vanity metrics.” They might look impressive, but they don't really matter at the end of the day. Those metrics won't help you pay your bills, allow you to take a vacation, or provide the kind of life for your family that you want.

For most businesses, there is a tipping point in terms of profitability. Many small businesses are too small to ever be truly profitable. There is a threshold that you have to hit, and it's a little bit different for every business. Below that level, it's hard to make much profit, because it's hard for the owner to specialize. It's hard to get really good at what you do and be really profitable. Granted, there are some exceptions. Some people can be solo entrepreneurs and do very well for themselves. But for a lot of people who are trying to build a lasting business, there is a certain size that you need to hit before you can get what you want from your business. I think of it this way – if your business was a horse, that horse has to be a certain size in order to carry your weight around. If you're trying to ride a Shetland pony, it's probably not going to work very well or go very fast.

Don't buy into the peer pressure that you always have to grow

That being said, you don't necessarily want to try to ride a Clydesdale either. There is a balance and finding it is important. Too many people who start businesses get caught up in growing for the sake of growing without thinking about what that really means. For businesses in what we call the “Startup Scramble” or the “Structured Ceiling”, growth can mean more work for the business owner. And keep in mind a big part of running a business also includes deciding where your personal balance lies for your family and for your happiness as a business owner. If you can find a happy balance for yourself in the Startup Scramble or more likely in the Structured Ceiling phase, that’s not a bad thing. Don’t buy into the peer pressure that you always have to grow.

If, however, you do really want to grow, there is another option. One that doesn’t require you as the owner to keep sacrificing more time toward that growth. We’ve seen this happen time and again in the real world with our clients using experience Andrew Jordan learned when he was President of a company that he turned from losing $200,000 a month, to being profitable within a year.

Fair warning: being able to scale your business requires you to grow as a leader, trust people in ways you might not be used to, make some hard calls, and do some things that make you uncomfortable. But, if you do want your business to grow, and are willing to do what it takes, we’d love to talk with you.

Are you figuring out how to specialize in your field of business? Check out one of our recent articles that addresses this topic!


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